We can differentiate between two main kinds of institutions, internal and external. Internal institutions have a greater degree of flexibility and are constantly evolving too fit the needs of individuals. An external institution, such as the overall legal order, is more permanent and certain. These two types of institutions may overlap in certain functions.
It’s also worth noting that this simple model should not be taken overly seriously. Institutions are not objectively external or internal. Their place in the hierarchy depends on their particular functions at particular points in time. These relationships are always shifting, as new institutions arise and novel relationships of complementarity come to exist.
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